In the course of performing the fiduciary duties of directors as well as board members, board members are charged with a lot of confidential information about their companies. Certain of this information falls under the category of non-public material data, which is restricted by corporate policies and law. Other information, particularly when it comes to companies that are for-profit, is highly sensitive and private. The fact that some of the information that is discussed in boardroom discussions is both sensitive and material creates a particular trust issue in the context of safeguarding that information from leaks.
Leaks can be catastrophic to businesses and the individuals who are affected. It’s possible that leaks will not just affect the company’s financial performance but could also hurt the reputation of the individual directors. Depending on the nature of the leak (and the circumstances that lead up to www.dataroomabout.com it) they could expose directors to civil or criminal liability.
The best way to safeguard confidential documents for boards is to make sure that all parties signing the confidentiality agreement understand exactly what information must remain confidential, and are willing to abide by those terms. This means identifying the information to be protected and clearly defining restrictions on disclosure. For example, it may be that the data can only be shared with the sponsor of the company or other directors.
It is also essential to give a comprehensive and robust Confidentiality policy to directors in general, or their sponsors in the case of directors of the constituency, prior to when they begin their duties. This will help them understand their responsibilities, and establish an environment in which confidentiality is considered an essential aspect of director’s responsibilities.